But a jury found him guilty of manslaughter for the Boxing Day 2013 killing of the man known in Canberra punk rock circles as the Ginger Ninja.

The verdict means Navin is likely to be sentenced in the new year and will face a maximum of 20 years jail.

Navin did not react when the ACT Supreme Court jury returned the verdict after deliberating for two days.

The victim's family and supporters hugged outside court after the verdict was read out, but did not comment on the result.

Jurors were given three options in deciding Navin's fate: guilty of murder, guilty of manslaughter due to diminished responsibility, or not guilty by way of mental impairment.

Navin killed his former housemate at Mr Sofer-Schreiber's Lyneham home on Boxing Day 2013.

He inflicted 73 stab wounds during the attack that lasted "tens-of-minutes", finally claiming Mr Sofer-Schreiber's life by severing major arteries in his neck.

The defence argued Navin was not guilty by way of mental impairment as he had been suffering from a severe psychosis at the time.

Navin has been diagnosed and is receiving treatment behind bars for schizophrenia.

Navin claimed he had slayed the avid punk rock fan in a preemptive strike as he believed Mr Sofer-Schreiber had been involved in his grandfather's death and had hired a hitman to kill more members of his family.

The court heard the pair had flatted together in 2012 and 2013, but Navin moved out mid-year and Mr Sofer-Schreiber sued him for a $60 repair bill.

The Crown alleged this acrimony simmered for the following months and Navin believed Mr Sofer-Schreiber had worked to ostracise him from their mutual friends.

Later in the year, Navin unsuccessfully tried to re-establish contact with the deceased, including once calling him several times in one day.

Navin told psychiatrists, after his arrest, that he had reduced and then stopped his medication about two months beforehand.

At the time he had believed he had been watched by "observers", had heard voices, and thought his mind could be read, he claimed.

Navin told psychiatrists that he had attempted to rekindle the friendship with Mr Sofer-Schreiber after receiving orders from the observers.

The men crossed paths at Christmas Eve drinks and were heard to make plans to lunch together the next day.

Navin texted Mr Sofer-Schreiber on Christmas Day but did not receive a response.

Navin saw Mr Sofer-Schreiber in a checkout line at a Canberra shopping centre on Boxing Day but the pair did not speak.

The prosecution alleged he then murdered Mr Sofer-Shreiber that night in revenge for social exclusion and rejection of his friendship.

But the accused claimed he had not decided to kill until he received a number of messages, including seeing a piece of wire that looked like a noose, later that evening.

Navin said he attacked Mr Sofer-Schreiber with a paring knife until it snapped, then completed the killing with a blade from the kitchen.

He then took a camp chair and tent, and drove north to a family property near Grafton where he burnt evidence, including the two knives, which he later disposed of in a dam. Police recovered the knives, and photos of them were tendered during the trial.

Navin returned to Canberra after being questioned by police and attended Mr Sofer-Schreiber's funeral.

Friends reported he exhibited odd behaviour, including breaking off mid-sentence to stare into space.

He was arrested in February 2014 and has been in custody since.

Outside court, defence lawyer Peter Woodhouse said Navin and his family had been relieved by the outcome.

"[Defence barrister Stuart] Littlemore, QC, and I both consider this to be a very good result for our client," Mr Woodhouse said.

"It has been patently obvious from the outset he was mentally unwell and, whilst the circumstances of the matter were tragic, Mr Navin's illness means he should not be held to account for murder.

"It is disappointing the DPP did not accept our earlier offer to plead guilty to manslaughter and save the community and my client significant, irrecoverable expense."